Here's Why BP Signs Accord to Acquire Wind Farm in Indiana
BP plc BP recently announced an accord to acquire the remaining 50% ownership stake in the Fowler Ridge 1 wind asset in Indiana.
Notably, the wind farm with 162 turbines, having capacity to produce 300 megawatt (MW) of energy, has been acquired from Dominion Energy Inc (D). However, the financial aspects of the deal have been kept under wraps. The transaction is expected, subject to regulatory clearance, to conclude by 2020-end.
The British integrated energy player also has operating ownership in Fowler Ridge 2 and 3 wind farms. Notably, the latest agreement, once completed, is likely to boost the net wind energy generation capacity of the energy major by more than 15% to 1,076 MW.
Overall, the investment reflects the company’s strong focus on renewable energy generations since investors are increasingly pressing oil companies to drastically reduce carbon emissions, which is in line with the Paris climate goals.
The company also plans to invest $70 million in Green Growth Equity Fund (“GGEF”) of India, as announced on Jul 7. The fund, being promoted by the India’s National Investment and Infrastructure Fund (NIIF) and the government of U.K., was established in 2018.
Notably, after the completion of the investment, India’s GGEF will be more focused on scaling up growth in zero carbon and low carbon energy solutions in the nation. Importantly, the investment is not only going to help India significantly lower greenhouse gas emissions but will also create a platform for the British energy major to invest alongside GGEF in many low-carbon projects in India that are commercially viable. The investment will also make BP a limited partner in GGEF and enable the company to represent on the advisory committee.
The fund, comprising investments from the governments of India and the U.K., has a target to reach roughly $700 million in investment commitments. Overall, with the investment strategy, BP is not only committed to reimagining the energy scenario for India but will also advance to become a net zero emission company by 2050 or sooner.
Nevertheless, BP is not the only company investing in non-oil businesses like renewable energy to align goals with the Paris Climate Agreement. Royal Dutch Shell plc RDS.A is another key energy firm planning to become a net zero emission energy firm by 2050. Eni SpA E is also committed to renewables for a cleaner future.
BP p.l.c. Price
BP currently carries a Zacks Rank #3 (Hold). Meanwhile, a better-ranked player in the energy space is Viper Energy Partners LP VNOM. The stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Viper Energy has witnessed upward estimate revisions for 2020 bottom line in the past 60 days.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
Click to get this free report
Eni SpA (E): Free Stock Analysis Report
BP p.l.c. (BP): Free Stock Analysis Report
Royal Dutch Shell PLC (RDS.A): Free Stock Analysis Report
Viper Energy Partners LP (VNOM): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.